Today: Intel cuts its sales forecast, blaming a drop in consumer PC demand. The government confirms the economy's growth is weakening. HP brings the bidding for 3Par to $2 billion.

Trouble for the tech economy

As the government confirmed today that the economy's recovery has been weakening, Santa Clara chip behemoth Intel warned that a sudden slide in consumer demand for personal computers will hurt its sales.

Intel, of course, makes most of the microprocessors that are the brains in our Mac and Windows computers. (It shares that market with its much smaller rival, Sunnyvale chip maker Advanced Micro Devices.)

"Revenue is being affected by weaker than expected demand for consumer PCs in mature markets," Intel said in a statement this morning. It now expects third-quarter sales of $10.8 billion to $11.2 billion. By contrast, its earlier forecast was for sales of $11.2 billion to $12 billion.

The only bright side: Businesses are still making tech investments. For Intel, its statement said, "The impact of lower volume is being partially offset by slightly higher average selling prices stemming from solid enterprise demand."

We have heard warnings in the past few weeks about the health of the PC market, both from analysts and computer makers.

For that matter, White noted, "Both Dell and Hewlett-Packard highlighted consumer PC weakness during recent July quarter conference calls. We believe these data points continue to highlight an accelerating deterioration in consumer demand."

More on the economy: The U.S. Commerce Department today revised its estimate of second-quarter growth in the nation's gross domestic product to a sluggish yearly rate of 1.6 percent, down from its earlier estimate of 2.4 percent. By contrast, GDP jumped at a 3.7 percent rate in the first three months of the year.

Federal Reserve Chairman Ben Bernanke, meanwhile, acknowledged the economy's slow pace in a speech today in Jackson Hole, Wyo. "Much of the unexpected slowing is attributable to the household sector, where consumer spending and the demand for housing have both grown less quickly than was anticipated," Bernanke said, according to a transcript on the Fed's website.

As for the tech economy, Bernanke noted that businesses' spending on software and equipment "should continue to grow at a healthy pace in the coming year."

Wall Street's reaction: According to our friends at The Associated Press, investors and economists had been fearing that the GDP report could have been worse. For that matter, according to AP, analysts had been expecting even lower third-quarter sales from Intel.

Well, that was fast: After Dell -- the Texas personal computer maker -- yesterday morning raised its offer for 3Par -- the Fremont "cloud computing" data storage company -- to $24.30 a share, Hewlett-Packard -- the Palo Alto tech giant that competes with Dell in the PC market -- yesterday afternoon increased its bid to $27 a share, or about $1.8 billion.

Why all the fuss over 3Par? Analysts say the deal would help either Dell or HP in their efforts to expand beyond the competitive, low-margin PC business and into the potentially much more profitable tech services market. For that matter, tech giants are trying to become a one-stop shop for tech services.

For HP, Gleacher & Co. analyst Dinesh Moorjani wrote in an e-mail this week, buying 3Par would build on its "converged infrastructure strategy of bringing together server, storage and networking technologies into a unified solution that reduces complexity in the data center."

Investors, hoping this bidding war isn't over just yet, pushed 3Par stock higher today. The shares closed at $32.40, up $6.37, or 24.5 percent.

HP stock, meanwhile, dropped 22 cents, or 0.6 percent, to close at $38. Dell finished at $11.89, up 14 cents, or 1.2 percent.

Aruba stock surges

Aruba Networks stock surged today after the Sunnyvale networking equipment maker reported that it had swung to a small profit in its most recent quarter.

After the stock markets closed Thursday, Aruba reported a $400,000 profit for its fiscal fourth quarter. By contrast, Aruba posted a $4.5 million loss a year earlier. Revenue increased 45 percent to $77.3 million.

And the widely watched Standard & Poor's 500 index: Up 17.37, or 1.7 percent, to 1,064.59.

Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Frank Russell at 408-920-5876. Follow him at Twitter.com/mercspike.